War in Ukraine has huge implications for B.C. agriculture

The effects of the war are piling onto existing challenges for farmers across the province.

Randy Reay, 69, is a cattle rancher who lives near Jaffray, B.C., in the East Kootenay region. 

He has raised cattle for slaughter his entire life and says that year after year, he's watched his business become more financially demanding. 

"We're selling our beef products at [around] the same price we were five years ago," Reay said. "The price of fuel has nearly doubled. The price of fertilizer has more than doubled. That puts a lot of pressure on us."

Russia's invasion of Ukraine means Reay's expenses will climb even higher. Less availability of fuel, fertilizer and grains, three products exported by Russia, Ukraine and Belarus, and relied upon by B.C. farmers, will affect producers around the province. 

Russia is one of the world's three largest oil producers, and, along with Belarus, among the world's largest exporters of agricultural fertilizer. Both Russia and Ukraine are among the world's five largest wheat producers. 

While B.C. farmers don't import a significant quantity of these products from eastern Europe, prices for all three are determined globally, and the costs of each one are soaring. 

According to Nasdaq, the price of crude oil rose from C$89.45 a barrel on Dec. 17 to $130 on March 17, impacting B.C. farmers' ability to power their machinery and transport their goods. 

According to Doug Zorn, a pork and poultry farmer from Grand Forks, even small-scale operations like his are impacted by the price of fuel.

"It's not like we go and plow a whole bunch of fields and so forth, but we just took some pigs to be processed at Salmon Arm, and we just put out $250 worth of fuel costs," said Zorn.

Meanwhile, the price of wheat futures rose from C$978.33 to C$1,386.07. Livestock farmers rely on wheat and other grains to feed their animals, meaning the cost of producing meat and other animal products is on the rise. 

The value of fertilizer has also shot up. For example, Itafos, a Canadian phosphate-based fertilizer company, has seen its stock rise from $1.46 to $2.21 in the last month. And Nutrien, Canada's largest fertilizer company, producing potash and nitrogen fertilizer, saw its share price jump from $98.03 to $124.

While most Canadian farmers rely on companies like Nutrien for their fertilizer supply, Malcolm Odermatt, who farms wheat and is the president of the B.C. Grain Producers Association, says a shipment of Russian fertilizer he needs for his crops is stuck in Turkey due to Canadian import sanctions. 

"It was already ridiculously expensive, and now it might not even be available," Odermatt said.

"I've talked to a few producers, and they say they won't even bother planting a crop if they don't have fertilizer."

The latest shortages add to existing challenges facing farmers around the province. 

Notably, wheat was already in short supply due to drought conditions in the prairies in 2021. According to Statistics Canada, the country's wheat production fell 38.5 per cent last year. 

Reay noted soaring hay prices have become an insurmountable barrier for some farmers.

"There are lots of people who've had to sell off their whole herds because they simply didn't have the feed to overwinter them. They couldn't afford the price," Reay said. 

Possible CP Rail strike 

A potential CP Rail strike could exert further pressure on supply lines. On Feb. 28, the Teamsters Canada Rail Conference, representing 3,000 CP workers, announced that 96% of its members had voted in favour of strike action to back contract demands.

On March 16, Canadian Pacific Railway said in a statement that it had issued 72-hours lockout notice to the union.

Karen Proud, the CEO of Fertilizer Canada, said that 75 per cent of Canadian-manufactured fertilizer is transported via rail, either for exportation to other countries via B.C. ports or to farmers who require fertilizer for their crops. 

Proud said a strike at this time would be a disaster. 

"This is not the time to throw another wrench into the supply chain. If [the teamsters and CP] are unable to come to an amicable conclusion, we're urging, desperately, that the federal government take immediate action to stop a strike," said Proud. 

Several B.C. farmers told CBC they would attempt to plant more crops this year to help fill the gap in food supply left by the war in Ukraine, but shortages and soaring prices will make increased production extremely challenging.

CBC British Columbia has launched a Cranbrook bureau to help tell the stories of the Kootenays with reporter Brendan Coulter. Story ideas and tips can be sent to brendan.coulter@cbc.ca.